VoIP's To-Do List

The industry will miss its date with density if it doesn't fix E911
and other problems.

Nearly every day I interview an entrepreneur, engineer or investor working
to make VoIP a mass market reality. Clearly they're making great strides.

Broadband telephony has rocketed from a few U.S. households in 2003 to a few
hundred thousand last year, and is poised to top 12 million by 2009.

But recent stumbles could delay VoIP's date with density. The missteps are
common to any new technology rollout but must be resolved lest positive
buzz turns to dissatisfied drone.

With that in mind, here's VoIP's to-do list.

If This is an Emergency ...

Vonage has more than 650,000 subscribers and will hit 1 million by year's
end. But most are single, tech-savvy early-adopters. To be a force, Vonage
needs the middle class; and VoIP won't play in Peoria without Enhanced 911
(E911).

The horror stories are there. A Vonage customer dials 911 when her infant
daughter stops breathing and reaches a recording. A Texas family gets the
same recording during a home invasion.

Whatever the reason the calls didn't connect -- even if the customers failed
to enter correct information -- that's unacceptable.

Parents don't skimp on safety. To borrow from the credit-card ad:
Savings on local- and long-distance calls using VoIP: $40. Knowing my 911 call
will go through if my kids are hurt or a maniac busts down my door:
priceless.

Amid bad press and lawsuits, Vonage is spending millions to interconnect with Verizon's E911 systems and is near a deal with Qwest. Talks with SBC
are less promising.

Rival VoIP providers brag that they're fully E911 capable, but the
perception that VoIP is risky is a problem for everyone.

If VoIP providers and telecoms don't do something now, government will. Next
week, FCC Chairman Kevin Martin is expected to propose a deadline for VoIP
E911 compliance.

You've Got Frustration

AOL is trying to do
for VoIP what it did for dial-up -- make it so damn easy that you don't have
to think about it.

I got a copy of AOL's VoIP test kit. The instructions promised I'd be making
calls in minutes. After 60 minutes, multiple reboots and cable checks, the
only call I made was to an AOL tech support rep via analog phone.

I don't have an engineering degree, but my library isn't packed with the
"For Dummies" series, either. There could be a good reason AOL's VoIP package
didn't work -- yes, even user error. But the point is, it didn't.

The entire process has to be easier to get the mass market involved. What's
more, the test version required that I download AOL 9.0. Now my IBM ThinkPad
laptop runs like a Commodore 64.

Then there's Verizon. The Baby Bell now lets
customers shift phone service to VoIP, wireless or cable providers while
retaining a Verizon DSL hookup.

This is a good thing, but the option, sometimes called "naked" DSL, has
confused many. Some service reps told customers it simply couldn't be done.
One reader took his case to a Verizon director before getting satisfaction.

Customers were partially to blame for not reading the fine print. Verizon's
naked DSL is only available to existing customers in 13 states.
They should contact the VoIP provider first, then Verizon with a port
request.

Moving The Needle

So where does this all leave VoIP in terms of cracking the mass market?
Qwest CEO Dick Notebaert, Captain Ahab to MCI's Moby Dick, recently offered
a measured assessment in the context of Qwest's business.

"Does it move the [revenue] needle in the next year?" Notebaert asked during
a conference call. "My prediction is it will get more hype than revenue,
but we're excited about it and the minutes of use continue to increase."

The sooner the VoIP industry solves these problems -- real and perceived --
the sooner the revenue needle will move.